The background of this research was a phenomenon that occurred in thework employees. Data from PDAM Malang, it indicated that high absence levels and showed that the performance of employees of PDAM Malang well. PDAM Malang also often get complaints from the public Malang related issues. Because of the phenomenon, the researcher tried to examine whether the factors that may affect the level of employee performance.

This research was a quantitative research. This study used the employeesof PDAM Malang as its object. Samples were taken as many as 40 people that were obtained using the formula of Slovin, while sampling used proportional random sampling method. The independent variables consisted of motivation and locus of control while the dependent variable was the performance of employees. Tests used the instrument validity, reliability, and classical assumption and in doing data analysis used path analysis (path analysis) with a significance test, the indirect effect, direct and total effect.

Based on the test results showed (1) motivation directly affected the locus of control (2) Locus of control directly affected employee performance (3) motivation had no direct influence on employee performance without locus of control